AUD/USD Forex Signal

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AUDUSD: Slightly bearish consolidation

Yesterday’s signals were not triggered as the price never quite reached the resistance level at 0.6800.

Today’s AUD/USD Signals

Risk 0.75%.

Trades must be taken between 8am New York time Thursday and 5pm Tokyo time Friday.

Short Trade Ideas

  • Go short following bearish price action on the H1 time frame immediately upon the next touch of 0.6800 or 0.6829.
  • Put the stop loss 1 pip above the local swing high.
  • Adjust the stop loss to break even once the trade is 20 pips in profit.
  • Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.

Long Trade Idea

  • Go long following bullish price action on the H1 time frame immediately upon the next touch of 0.6746.
  • Put the stop loss 1 pip below the local swing low.
  • Adjust the stop loss to break even once the trade is 20 pips in profit.
  • Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.

The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.

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AUD/USD Analysis

I wrote yesterday that as the price was within both a narrowing triangle and a bearish price channel at the same time, I had no confidence in any breakout which might happen soon, so I would avoid trading this currency pair for the day. This was a relatively good call as the consolidation has continued for yet another day.

The technical picture is slightly more bearish with the break of the formerly supportive trend line leaving the chart dominated by a bearish price channel. However, both the levels at 0.6800 and at 0.6746 look strong and equally balanced, so I would take a trade from a strong reversal off either of them – I have no directional bias.

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There is nothing of high importance due today concerning either the AUD or the USD.

Adam is a Forex trader who has worked within financial markets for over 12 years, including 6 years with Merrill Lynch. He is certified in Fund Management and Investment Management by the U.K. Chartered Institute for Securities & Investment.